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Historic Declines

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By any financial measure, this fiscal year is a terrible one for public higher education. And while that's no surprise to anyone working at a state college or university, new national data document the extent of the loss of state support.

Total state support for higher education for 2009-10 -- including federal stimulus dollars -- is $79.4 billion, which is a decline of 1.1 percent from the prior year and 1.7 percent from the year before that. This represents a dramatic shift from the three-year period of 2005 to 2008 when state support grew 24 percent, to $80.7 billion -- without federal stimulus dollars in the equation. Without the federal stimulus contribution, which is now over, state support this year would have been down 3.5 percent over one year and 6.8 percent over two years.

These figures are being released today in Grapevine, which since 1960 has been the definitive source of annual data on state support for higher education. Grapevine has been published by the Illinois State University Center for the Study of Education Policy, and starting this year it is also being produced by the State Higher Education Executive Officers. The statistics in the study are state funds for operating support, and do not include tuition revenue.

The percentage declines -- with or without the federal stimulus funds -- understate the extent of the financial pressure on public higher education. Those percentages don't account for increased costs of providing higher education or of enrollment increases, which have been taking place around the country, with growth in double digits at many public institutions. Further, some states are still contemplating additional cuts this fiscal year.

In an analysis released with the numbers, Paul E. Lingenfelter, president of SHEEO, noted that state support for higher education has been "resilient but inconstant" over time. Past recessions have resulted in absolute declines in state support, usually at times of enrollment increases, but they have been followed fairly quickly by recoveries in which states have "caught up" in support.

"While the historical pattern provides reassurance and evidence of enduring public commitment, the current recession and a convergence of other pressures on states and the American economy have eroded the ability of states to rebuild their financial support for higher education," Lingenfelter writes. "The resiliency of public financial support for American higher education is threatened, putting its quality and capacity at risk."

Lingenfelter sees the situation reaching "crisis proportions" for three reasons:

More than 5 percent of the current year's state appropriations nationally are coming from federal stimulus funds, which are "exhausted."

State revenues have fallen at such an "unprecedented rate" that it will take states many years to recover.

Current enrollments, even after increases of the last two years, "almost surely understate student demand, with many students who would otherwise enroll deterred by tuition increases and budget-driven enrollment caps and course cancellations."

He concludes his analysis by saying: "Complacency about the adequacy and quality of public higher education puts the future of the American people in jeopardy -- economically, intellectually, morally. Public higher education is not an optional priority."

Of the states reporting good appropriations years, the best off happen to be two with relatively small populations: Montana (up 23.3 percent) and North Dakota (up 18.5 percent). Among states with large populations, the best off by far was Texas, with an increase of 12.5 percent.

Overall, 28 states experienced declines in total state support (even after stimulus funds were added). Without stimulus funds, 37 states would have reported absolute declines in support this year.

The declines are so steep that eight states experienced declines in state support between 2005 and 2010 (when looking only at state funds): Iowa, Massachusetts, Michigan, Nevada, Ohio, Rhode Island, South Carolina and South Dakota.